Cboe Global Markets prepares to launch the first cash-settled options linked to the price of Bitcoin spot (BTC), whose trading is expected to begin on December 2, according to a November 22 report. press release.
These options will be based on the Cboe Bitcoin Us ETF (CBTX) Index, designed to reflect the performance of spot Bitcoin ETFs listed on US exchanges.
This landmark product aims to provide investors with exposure to one-off Bitcoin price movements without directly owning the crypto. The launch comes days after US regulators gave Bitcoin options the final green light earlier this month.
The launch includes standard and mini index options, as well as customizable FLEX options, offering a range of tools to capitalize on price movements, manage risk and express market opinions.
Approach to Bitcoin Options
The Cboe Bitcoin US ETF is the first of its kind in the United States. It relies on a modified market cap-weighted approach to tracking the performance of spot Bitcoin ETFs. By reflecting Bitcoin spot price trends, the index provides a representative measure of the asset.
THE choice will feature cash settlement, ensuring positions are closed in cash upon expiration, eliminating the complexities of Bitcoin ETF delivery. Additionally, the European-style exercise mechanism allows options to be executed only on the expiration date, thereby minimizing the risks of early grant.
The mini options, under the symbol MBTX, will be available at 1/10th the notional value of standard index options, attractive to portfolios of various sizes and providing flexibility to small traders.
FLEX options will allow customization of strike prices, styles and expiration dates, catering to sophisticated trading strategies.
Expanding into digital assets
The introduction of these Bitcoin options aligns with Cboe’s broader strategy to enhance its digital asset derivatives portfolio.
The exchange already supports Bitcoin and Ethereum margined futures on its digital platform. Pending regulatory approval, these futures contracts are expected to be transferred to the Cboe Futures Exchange in 2025.
Adam Inzirillo, global head of data and access solutions at Cboe, said:
“This launch highlights the strength of Cboe’s ecosystem, integrating data, indices and innovative products to meet the diverse needs of investors.
Cboe remains at the forefront of the evolving digital asset market, listing the majority US Bitcoin and Ethereum spot ETFs.